Summaries of health policy coverage from major news organizations

Feds Take Closer Look at Marketing of Medicare Plans

Medicare Advantage private fee-for-service plans are "coming under increasing fire" from CMS officials "worried about tactics used to market them" and from lawmakers who believe the plans receive "exorbitant government payments," the Wall Street Journal reports.

Abby Block, director of CMS' Center for Beneficiary Choices, said the agency is "particularly concerned" about sales agents who do not adequately inform Medicare beneficiaries that fee-for-service Medicare Advantage plans differ from traditional Medicare.

Doctors might decline to treat patients enrolled in the private plans because they have little experience with the plans, and in some cases, they might be concerned that reimbursements will be inadequate or slowly paid, the Journal reports.

To address these issues, CMS officials say they will require private fee-for-service Medicare Advantage plans next year to call all new beneficiaries to make sure they understand that the plans are not traditional Medicare. CMS also will implement a "secret shopper" program to police marketing practices and will require insurance companies to train sales agents on how the plans work.

Meanwhile, House Ways and Means Health Subcommittee Chair Pete Stark (D-Calif.) and other Democrats are trying to reduce payments to all Medicare Advantage plans -- including managed care and private fee-for-service plans -- to the same level as traditional Medicare reimbursements.

The government spends 19% more on private fee-for-service Medicare Advantage plans than traditional Medicare and spends 12% more on all Medicare Advantage plans, according to the Medicare Payment Advisory Commission. MedPAC recommended that the government cut payments to Medicare Advantage plans to the same level as traditional Medicare.

Stark said that the savings could be used to reduce scheduled payment cuts to doctors, improve Medicare benefits or provide health coverage to children. However, "lawmakers of both parties ... [are] wary of doing anything that might prompt the plans to drop out of rural markets," the Journal reports (Zhang, Wall Street Journal, 5/8).

Editorial

Some Medicare Advantage plans "have been caught using hard-sell tactics to pressure elderly Americans into signing up for policies that may leave them worse off than they would be with traditional Medicare coverage," a New York Times editorial states.

"It seems that outrageously high government subsidies aren't enough to satisfy the private plans that participate in Medicare," according to the editorial, which adds that the "abusive sales tactics are particularly egregious among the private fee-for-service plans" that "receive the highest subsidies and do the least to earn them among the array of private offerings available for Medicare recipients."

The editorial concludes, "Congress needs to demand rigorous policing of the Medicare Advantage program to ensure that such abuses do not continue. And it should eliminate these lavish subsidies, which are draining the Medicare trust fund and imposing unfair costs on beneficiaries in the traditional Medicare program" (New York Times, 5/8).

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